Warding off embezzlement
Warding off embezzlement
Pima County officials want to avoid big-time fraud … Santa Cruz County still dealing with fallout ... Bad look for sheriff.
Pima County officials watched uneasily over the past few months as their counterparts in Santa Cruz County dealt with a $39 million embezzlement scheme.
The question of the moment at the supervisors’ Tuesday meeting was “How do we make sure it doesn’t happen here?”
The alleged scheme in Santa Cruz County went on for a decade before it was uncovered in April when a bank flagged suspicious activity. County officials in Santa Cruz say former Treasurer Liz Gutfahr manipulated records to hide the embezzlement, which the state Auditor General said involved 182 wire transfers from county bank accounts to Gutfahr’s business accounts.
That $39 million is nothing to sneeze at, particularly for the school districts that were hit the hardest. But if a similar scheme unfolded in Pima County, an embezzler would be looking at a much bigger pot of money to steal from.
Pima County’s $1.7 billion annual budget is 10 times the size of Santa Cruz’s budget. And the flow of money is tremendous. At any given moment, Pima County has about $1.5 billion in deposits and officials move between $100 million and $300 million each week.
The political stakes also are pretty high. The Santa Cruz County supervisors took a lot of the blame for not catching on to the embezzlement earlier. Two of the three supervisors ended up losing their primary elections this year.
“We should not have to pay for mistakes that you guys as supervisors have made. I'm personally happy to see that two of you supervisors are actually getting fired,” Tubac resident Beth Castro told the Santa Cruz County supervisors at a budget meeting, the Nogales International’s Angela Gervasi reported in August.
Pima County Treasurer Chris Ackerley assured the board on Tuesday that the county has controls in place to make it nearly impossible for a similar scheme to unfold in Pima County.
You know what else is an effective control against government corruption? Good journalism. And it’s a lot cheaper than $39 million.
Ackerley, who is running for a four-year term in November, hinted that he himself was one of those controls.
“First off, the character of the person in this office obviously is, I mean that's a big issue here,” Ackerley said.
On a more practical level, the Pima County treasurer can’t make payments directly to vendors, which Ackerley said appears to have been the case in Santa Cruz County.
Instead, each payment goes through multiple people who initiate the payment, approve it, balance it, and then reconcile it.
The treasurer’s office also can’t wire money directly from an investment account “to the outside world,” he said.
School districts account for about half the money held by the Pima County Treasurer’s Office, Ackerley said. While each school district or fire district keeps track of their own finances, “one of the missing pieces” is having somebody bring it all together and compare it to the records at the treasurer’s office, Ackerley said.
That missing piece might have been why the embezzlement in Santa Cruz went on for so long, he said.
As for what needs to be done to make embezzlement even more difficult in Pima County, Ackerley laid out the following steps:
The state Auditor General is revising their operating manuals and he expects to see new legislation next year to sharpen the auditor’s tools.
The county is going to make financial institution statements directly available to auditors, rather than have auditors ask county officials for them.
His office is going to give regular reports to the board of supervisors.
Perhaps most important of all, he said they would look at revising some of the reports “to make them understandable to the public.”
That would be welcome news for anybody who’s had to wade through the county’s complicated financial information.
And what better way to make an embezzler shiver in their boots than to put a million pairs of eyes on what they’re doing?
What’s the opposite of “rave” reviews?: Pima County Sheriff Chris Nanos’ decision to suspend his political opponent, Lt. Heather Lappin, ahead of Election Day (and as voters already are filling out early ballots) continues to get trashed by local columnists and politicians.
Tucson Sentinel columnist Blake Morlock says Nanos crossed a “fat ethical line” and Democratic voters shouldn’t give Nanos a pass just because he’s a Democrat, particularly those who claim the moral high ground by opposing Donald Trump’s abuses of power.
Pima County Supervisor Matt Heinz, a Democrat, wants the Board of Supervisors to ask the Arizona Attorney General’s Office to look into the suspension at the board’s next meeting in mid-November, KGUN’s Craig Smith reports. Heinz, who endorsed Lappin in the sheriff’s race, called Nanos’ move “dictator stuff.”
The Arizona Luminaria fired back after Nanos said they paid an inmate at the county jail for a story, which Nanos included as part of his rationale for suspending Lappin. The allegation boiled down to Luminaria reporter John Washington reimbursing an inmate who paid $20 to use a jail phone to speak with Washington for an interview, the Luminaria’s Yana Kunichoff reports. The outlet sent a newsletter yesterday with the headline “$20 well spent” and quoted a journalism expert saying it wasn’t unethical to reimburse an economically disadvantaged source for an expense incurred by doing an interview.
Call to the public: The City of Tucson wants to hear from residents about renaming Christopher Columbus Park, KJZZ’s Alisa Reznick reports. The call from city officials comes after a four-year effort, sparked by Tucson City Council member Lane Santa Cruz’s office, to rename the park after Danny Lopez, a celebrated Tohono O’odham elder and cultural educator.
Missile malfeasance: The company formerly known as Raytheon, which has a major facility in Tucson, agreed to pay nearly $1 billion to settle allegations it lied to federal officials to justify costlier no-bid contracts, double-billed the government on a weapons maintenance contract, and paid bribes to get business with Qatari military officials, the AP’s Jake Offenhartz and Michael R. Sisak report.
5,325: The ballots returned by Pima County voters as of October 15.
